Agra footwear industry, which is the largest footwear manufacturing hub in India with estimated annual manufacturing value of almost Rs 10,000 crore, is mulling forming consortiums of individual units to cater to large export orders.
The idea is to combine manufacturing capacity of big units operating in the organised sector and stand in competition to Chinese firms, which are known to absorb large export orders and strictly meet delivery schedules.
“We have mooted the idea amongst us and our members are positive towards forming such consortiums in the wake of tough competition from China. Consortium concept has to come if we want to enter the big league in export market,” Agra Footwear Manufacturers & Exporters Chamber (AFMEC) president Puran Dawar told Business Standard.
He said China had units with manufacturing capacity of 40,000 pairs per day, while it was difficult to find units with 2,000 pairs capacity in India.
“Global retail chains place bulk orders to the tune of almost 500,000 pairs and such large orders are difficult to cater to by individual units. Therefore, the idea of forming consortium has been proposed,” he added.
At present, Agra accounts for almost 35 per cent of the total footwear exports from India, while it also caters to 65 per cent of the domestic footwear market.
Footwear segment plays a significant role in India’s leather industry. India is world’s second largest footwear producer after China, accounting for 13 per cent of global footwear production of about 15 billion pairs.
There are around 10,000 footwear manufacturing units in Agra operating both in the organised and unorganised segments, of which 150 are sizeable with focus on the export market. Top players cater exclusively to exports with negligible contribution to the domestic market.
“We are targeting to touch Rs 2,400 crore worth of footwear exports from Agra in the current fiscal, compared to Rs 2,000 crore last year,” said Dawar, who is also the North Region chairman of Council for Leather Exports under the union commerce and industry ministry. He is the managing director of Agra-based footwear manufacturer Dawar Group.
“There is a lot of potential for India and China in the global footwear market. However, China is now saturated and the major importing countries, such as USA are now looking at India,” he noted.
About 30-35 per cent of Agra population depends upon leather footwear manufacturing industry providing employment to nearly 500,000 people.
Some global brands that source footwear from India, include Zara, Esprit, Lumber-jack, Deichmann, Carrefour, Metro, Hugo Boss, Pierre Cardin, Acme, Clarks, Deichmann, Ecco, Elefanten, Florsheim, Hush Puppies, Marks & Spencer, Nautica, Nike and Reebok.
